Frugal Beautiful

Posts Tagged ‘Financial Planning

The famous line “People first, then money, then things,” comes from financial guru Suze Orman.  I adore Suze- I am watching her show right now on Itunes.  Fabulous stuff!  While her other advice is great- “people first,” is really something I’ve been focusing on.  I’m currently on the 30-Day-No-Shopping Challenge and I realized that time not spent shopping needs to be filled with something else in order to succeed.

Filling your life with people, not things is a way to free up your money for greater opportunity: retirement, starting a business, going on vacation, cutting your work hours and living comfortably…or how about this:  not bursting into tears when the credit bill comes each month?  That sounds pretty darn good.

 

Shopping keeps us busy.  It also gives us a sense that we’re building something- a more beautiful home, a more savvy wardrobe to spur more confidence,  a repertoire of things to make life better, faster, more efficient.  But what it all boils down to is people.  We want a nicer home to invite friends over and gadgets to entertain them with, a wardrobe that inspires awe and praise from people at work,  a birthday gift that shows our appreciation.  While things can be useful- it’s a distraction from the sometimes intimidating work of making personal connections with people and building community based on our own personalities and effort.

I recently had some friends over for drinks after hitting up a discount pizza place for their Monday night specials.  Honestly, I was embarrassed to have them over- my new apartment was sparsely furnished- we didn’t even have enough chairs for everyone.  I found myself fretting over the appearance of my apartment, but of course- as you can imagine, nobody cared.  Everyone was just happy I opened my home and we had cheap beer and wine and sat around and talked.  They were happy to get together, and in the end, I was happy to have done it.  Relying on personal connections and not things can be scary-  but often the experience is more genuine.

To ensure the success of my No-Shopping Challenge, I’m filling my life with EVENTS and not stuff.  I’m going to knitting meetups and attending health workshops.  I walk my dog each day and finally tackle projects that have been nagging at me.

 

Shopping has been a distraction for far too long.  It makes you feel accomplished, productive and successful when you can buy something new- especially when you’ve hunted down a good deal, but the activity of shopping usually distracts from other activity.

What are you using shopping to hide from? How are “things” holding you back from genuine experiences and connections with people?  Does debt keep you in a constant state of stress or does shopping hide the fact that you haven’t explored what really makes you happy?  Do you feel you don’t have the right “things” to start your goals?  (Trust me, having a cute pair of Nikes will not really encourage you to go to the gym).

People first– the money will sort itself out and the the things will matter less and less.  You will have exactly what you need.

 

 

I asked the question, perhaps too late, “What can I do with a graduate degree in sociology,”  and the timing was such that I really had to ask, “What can I do with half a graduate degree in sociology.”  Truth be told- nothing.

I spoke to two of my professors last week, and neither really knew what to tell me.  For the reasons I had to stay, I had equally compelling reasons to quit- namely my cost-to-benefit comparison based on passion vs. affordability.  If you are passionate, it’s hard to argue something is “too expensive,” in most situations- but what if you are confused like me?

My professors asked some hard questions:  Did I have something else in mind?  I did not.  Sure- I love to write- but am I confident enough in my skills as they stand to walk away from a possible degree?  I am not sure that starting over at this point and trying to stay afloat based on my entreprenurial skills alone would be wise.  I love to blog and explore different markets and niches- but I feel my inexperience would kill my passion if I were to step out at this point. Having a graduate degree could be beneficial for someone like myself who is at this point in the process.  For those who still have time to choose- take that time and ask lots of really hard questions before you commit.  But of course, sometimes all we can do is to assess the “known unknowns,” and take a step forward.

I also voiced my concerns about the cost of grad school.  They sympathized that costs are high and post-graduation prospects for employment are low- and at least are not up to expectations for newly minted degree holders.  What they did say though, is you can do nothing with half a master’s degree, not even get some kudos for “some graduate level courses” on a resume.  The sad truth is- there is no way to to know if the amount of debt I’m taking on is going to impede my chances to succeed in other areas, nor is a graduate degree an automatic key to success.

The debt itself will not prevent me from affording a wedding, car or hell, a piece of Tiffany, just as the degree itself will not ensure my immediate success- but my efforts outside the classroom will.  The only thing preventing me from being able to afford the life of my dreams is simply my inability to make them happen- and I can work on that.  My time in the classroom (or out of it) will not find me a man to love  or a dream job, nor will my debt stand in the way of buying a house or starting a family or starting my own company if that’s what I choose to do.  What will stand in the way of those things is my fear:  Fear that debt will ruin my future, fear that I’m not on the right path, fear that I’m not making the right choices.  Fear needs to be taken into consideration- it can be a very smart survival tool, but being too cautious blocks progress.

There is no way to gauge your prospects based on having debt or having a degree alone–  you just have to ask questions, evaluate, and take a risk.   The  the best decisions you can and forgive yourself for mistakes of inexperience.  Get your hands dirty- at least you can say it was YOUR mess and have something interesting to say at the high school reunion.

I meticulously planned my path to grad school and based my decision on the person I was at the time.  I had no way of anticipating the process itself would change me in the way it did.  While the reasons I had in coming to graduate school are no longer the reasons I am staying- I am still confident in those decisions.  I am not the person I was a year and a half ago, and I no longer harbor the same motives or goals I did before, and perhaps, that was the point?

 

 

 

Oh-so-frugal-beautiful!
Part of being in control of your financial life is being aware of what really matters to you.

Many frugal-gurus advise you to cut down on your “latte factor”…small purchases that may only cost a few dollars but add up over time.

My advice stems from this-prioritize your spending based on what you can’t live without, or simply what brings you the most joy- even if it’s small purchases.

I used to love having my nails done. I would get a pedicure once a month and I had gorgeous acrylic nails. They were great for back scratching, looked great, and I totally loved them. They cost me $25 every three weeks, and $23 for a pedicure. For a flat fee of $25, I could buy my own supplies to do at-home mani/pedis. I calculated that I could roughly save $438 a year if I simply did my spa treatments at home. I can’t do my own acrylics, but I can choose from some gorgeous nail colors, and the security of knowing I’m able to pay my bills each month is totally freeing.  Now I love to do my nails, and have freed my money up for something that brings me greater fulfillment.

When I moved to Chicago, I had to rethink my priorities- number one being the security of having my bills paid in full without additional stress. I then had to categorize my spending based on what would make me the happiest. What did I decide? I decided for me, I didn’t need to get my nails done, pay for cable, purchase books and use the library instead, and I’d brew my own coffee and cook more at home. I also decided to sell any books, shoes or video games I didn’t need to earn some extra coin to pay for things I really wanted. I chose to get a cheaper apartment that with utilities, was under $400 a month (And note to my friends that tease me for being frugal in my living space? Well “friends,” my stuff is PAID FOR, now come over for some boxed wine!).

What did I decide to spend money on? Getting stylish clothing appropriate for midwest weather and to look hot in the cold Chicago winters, getting a dog (that will probably cost me $450), signing up for yoga, and starting this blog. I also decided that I was willing to spend more on purchases to support small businesses for groceries, clothes and yarn- that makes me happy. I was willing to cut back on my shopping in other arenas and look for savings to make this happen.

Plus, you can still have everything you want/need by looking for cheaper alternatives, searching for coupons/discounts, swapping with friends or negotiating cheaper rates on your monthly bills.  Everything is attainable!

Am I happier despite the sacrifices? You better believe it. Being financially efficient is different for everyone- cutting back on your lattes might be cost effective and motivating for one and yet depressing for someone else.  You know what is worth spending money on in terms of your own joy and security- if you can afford convenience in one area, but can D.I.Y. in another- you have the power to make that judgement call!

Take a few minutes to evaluate what matters to you, and allocate your money accordingly to maximize the happiness from each dollar.

Valentine Piggy  {09.365}

You need to be doing one of two things:  Either paying off your debt or saving for your future. RIGHT NOW.

If you have income, you need to either get out of debt or put a little money away for saving (or spending!)

I can not entice you with promises of how great it will be when your wrinkly-ass wants to be at the vacation home for your retirement years in Florida with the grandkids- but I hope I can help you realize that in 6 months, that microwave/wedding/vacation/new Coach Purse isn’t going to pay for itself and it sure as hell is not going on a high-interest credit card!

You will hear over and over again that you need to save for the “unforeseen problems” that are bound to happen as you age.  Well, screw that.  I’m here to tell you that you need to be saving for the problems you TOTALLY SEE coming in the next 6-12 months and will save you from the agony of paying 12-18% (plus late fees) on it.

In my previous finance article, I asked you to be aware of your present spending habits.  Now I’m asking to couple this awareness with thought about the not-so-far-off future, with purchases that are tangible.  Sure, you could get more excited about a new pair of Jimmy Choos, but I think you’ll get just as excited about replacing a crappy coffee maker if you know it’s paid for in cash and you don’t have to go on living without it.

You know you have purchases coming up, or perhaps you’re already sweating about what you already bought.  Stop fretting (or avoiding) retirement planning, and get your youth out of the sinkhole!

Resources on the Interwebs:

Mint.com–  Set goals and set budgets in a simple fashion that you can follow online or on your phone.

SuzeOrman.com– Her website is great, but check out the free podcast of her show or her fabulous gender and genre specific finance books.

Up next? This may sound counterintuitive, but I will soon be posting my FAVORITE links to finding designer duds for stupid-cheap.

I’m going to be posting several small articles that will help you tackle your finances and be your most powerful self in quick, do-able steps. Today’s step?

Take 5 minutes to look through your wallet, bank statement and credit card bills.  Taking stock of what’s going on with your spending habits will give you powerful insight to take control of your life!

It is time to get real with your finances, because you know you aren’t doing what you should!  Take a good hard look at what’s going on in your wallet (or how many swipes away you are from wearing a hole in your credit card) and evaluate what’s happening in your life.

Your finance habits correlate with your thinking and living habits.  I can tell you when I relocated to Chicago, my spending was out of control!  While I bought a lot of things I needed for the new place and new weather conditions, I was so desperate to get “settled,” that I didn’t think my purchases through.  Needless to say, I ended up with two pairs of boots purchased online I don’t use, and three very high credit bills.  I was so stressed about feeling secure in my personal life, I was doing the opposite in my financial life!  Take stock (and a good hard look at  where your money is going) and spend just 5 minutes quickly spotting any red flags or things to simply be aware of.

It’s that simple.


Check out some of my favorite sites that will make this goal a breeze and give you ideas!

www. Mint.com – (MY FAVORITE TOOL)- online or on my phone!   In 10 minutes you can see every penny you have saved or spent in savings, CD, investments and credit cards.  PLUS they generate great tips and leads for better ways to save money on purchases and gain more for your savings!

http://www.dailyworth.com/ -their daily emails are fabulous!

http://lifehacker.com/

http://www.budgetsaresexy.com/ -they so totally are!

http://www.Wisebread.com

http://www.frugalvillage.com/ -I love the forums, any question you want answered from a variety of perspectives!

Up next? Two simple things you need to be doing to live a healthy financial lifestyle- and it doesn’t have to be painful!


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